Statistical methods of estimating mining costs

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Abstract

Until it was defunded in 1995, the U.S. Bureau of Mines maintained a Cost Estimating System (CES) for prefeasibility-type economic evaluations of mineral deposits and estimating costs at producing and non-producing mines. This system had a significant role in mineral resource assessments to estimate costs of developing and operating known mineral deposits and predicted undiscovered deposits. For legal reasons, the U.S. Geological Survey cannot update and maintain CES. Instead, statistical tools are under development to estimate mining costs from basic properties of mineral deposits such as tonnage, grade, mineralogy, depth, strip ratio, distance from infrastructure, rock strength, and work index. The first step was to reestimate "Taylor's Rule" which relates operating rate to available ore tonnage. The second step was to estimate statistical models of capital and operating costs for open pit porphyry copper mines with flotation concentrators. For a sample of 27 proposed porphyry copper projects, capital costs can be estimated from three variables: mineral processing rate, strip ratio, and distance from nearest railroad before mine construction began. Of all the variables tested, operating costs were found to be significantly correlated only with strip ratio.

Additional publication details

Publication type:

Conference Paper

Publication Subtype:

Conference Paper

Title:

Statistical methods of estimating mining costs

ISBN:

9781617829727

Year Published:

2011

Language:

English

Larger Work Title:

SME Annual Meeting and Exhibit and CMA 113th National Western Mining Conference 2011

First page:

147

Last page:

151

Conference Title:

SME Annual Meeting and Exhibit and CMA 113th National Western Mining Conference 2011